Yet competition for homes is as high as it's ever been — if anything, a slim supply of homes is keeping buyers on the sideline — and prices are rising, albeit more slowly than they were a year ago.

It's a brisk, animated market. But it's still not a healthy, sustainable one. Prices are rising at rates untethered to inflation and gains in income. And construction of new homes hasn't ramped up to meet new demand.

"We're not seeing normal levels of housing activity," said Josh Lehner, a senior economist with the Oregon Office of Economic Analysis. "We're going in this direction where there's a supply response coming, but it hasn't come as strong as we would've thought maybe a year and a half ago."

Mixed messages

Taken month by month, 2014 has been a difficult year to read.

Sales are up one month, down the next. June was a strong month, with sales up 4.2 percent from a year earlier — the best June since 2007. But it comes after three months where sales were down (March), up less than a percent (April), then down again (May) compared with a year earlier.

It's clear the housing rebound has lost some momentum. The number of sales is essentially flat from a year ago. Prices are still rising, but the increases have slowed from the the double-digit percentages seen in 2013.

Still, tell that to the close-in neighborhoods of eastside Portland, where houses can sell in a matter of days — or hours — rather than weeks, and often at thousands of dollars above asking price.

Homes are moving quickly across the metro area, real estate brokers say, as long as they're priced right. The inventory in months — a measure of supply and demand — has hovered since April at 2.8, indicating it would take 2.8 months to sell every house on the market if sales continued apace.

That indicates a seller's market. It's a dramatic change from the housing-crash years, when the market was flooded with supply and little demand.

And the limited supply has become a factor keeping sales numbers from rising.

That's also a primary reason home prices are getting higher — 6.7 percent higher in June than a year ago. The competitive market has set off bidding wars on desirable properties, and the influence of a glut of discounted foreclosures is fading as the recession becomes increasingly distant.

Despite the increases, homes remain relatively affordable, Lehner said, at least for people who can save up for a down payment. And even though the median sale price is 16.9 percent higher than it was in January 2013, the run-up hasn't scared off enough buyers to curb sales.

"The fact that we had such a dramatic increase in the sale price in 2013 and the activity is still pretty flat in the first six months of 2014 is a pretty good thing," said Jeff Wiren, a principal broker with Re/Max Equity Group in Beaverton. "To have that kind of appreciating gain in that kind of timeframe and see activity remain relatively constant I think is a very healthy sign."

Home prices cooling

The home price gains have slowed, nearer to a sustainable rate of appreciation that's in line with inflation and wage growth.

"That's going to be a good thing for affordability," said Lehner. "Things can't go up at 10 percent a year forever."

More homes on the market would help cool things off further.

The price increases so far, though, haven't been enough to coax homebuilders back into action. Home construction, which virtually stopped in the recession, remains well below historic norms.

Building more supply

That may change soon. Builders are beginning to ramp up their construction efforts, said Post, who works with homebuilders to sell newly constructed homes. Land divisions and permits for new homes are on the rise.

"Our inventory levels will definitely be helped by the number of developers producing new lots," Post said.

But they have at least three to five years of under-building, said Lehner. And those homes will take months to bring to market, too.

"You could go out and start 10,000 new homes tomorrow, but that's not going to do anything to the market for six months or a year," he said